New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1887-12-31
THE PACIFIC ADJUSTMENT.
rWO REPORTS FROM THE INVESTIGATING
COMMISSION.
~ux Majority REPORT IN FAVOR OF Sitting
rHE PACIFIC RAILROAD DEDrs-A sEN"RE
CRITICISM OF COMMISSIONER PATrisoN-
ur .rIturs or THE RICO MMENDN-


rup PACIFIC RAILROAD DEDrs-A SEVERE
CRITICISM OF COMMISSIONER PATrIsoS-
FEATURES oF THE RECoMMEND,-
TONS TO CONGRESS.
WAsuINGTON. Dec 3O.-lhe reports ol ti.o
Commissioners appointed TO investigate the f"ciic
railroads which have received aid from the Lnited
States were made public to-day 1hey VIII De
sent to Congress when ii reassembles next week
r Elery Anderson, OF Nw-York and David 1.
Iittlcr Of Illinois. unite in the majority report
and a separate report is submitted by Robert Il.
Pattison. of Pennsylvania. The accountants who
assisted the Commission were Richard F. Stevens
ard Colonel Calhoun and Colonel Richard Il. Nor
gan IT, was employed as inspecting engineer
PRESENT CONDITION OF THE COMPANIES
The majority report is subdlvlded INTO 'hrec
parts the first relating to the present cohdi'oh oi
the companies their relations to the Government
and the remedial measures to he adopted the Sec
ond reviewing the financial operations OF the COM
panies and the third part containing answers 10
the yarions inteTOgations embodied III the Dill I'M
der which the Commission was constituted In
the first part the Commissioners explain that the
subsidy bonds did apply to the entire length OF
the roads The roads are found to he able to fully
discharge all the services that may he required OF
them fnll description Of the territory through
which the roads pass is entered into. and then the
question OF the Union lacifc's branch roads Is
taken up The n lcage Of these roads exceeds that
of the main road and many Of hem do not pay the
cost of actual operation But the Commissioners
find that i'll addition to the actual earnings derived
from local operation there is a large profit derived
from tho earnings Of all business mt rclansed be-
tween the branches and the main road nv reason
Of the haul over the main road. The minority re
port denies the advantages Of the branch line sys-
tenn hut the majority report defends IT, and con-
cludcs that the branches and the main line are
mutually dependent each other far support and
development, and united represent vastly greater
relative earning power than would either the
branches or the main line itself II they were dis
membered.
WHAT TIL UNION PACIFIC DrBT Is
The actual vaiuc of the Union Pacific system Is
placed at about II 30 600. 600. The funded debt
is put at So. ofo127 December 81. $50. Of
which s38. 80 Oo0 was prior to the United States
statutory lin. 4 mortgage executed today to
the GOVERN, NJ would be subject to the burden Of
about 81 3. COO 600 in addition 10 the first mort
gage and the debt due 10 the United States. The
debt due the GovcTmcnt from the Union and Kan
sas Pacific Companies is S73.3lG.96s less
sl54lO 500 in United Stacs bcrd ard interest ac-
count and g 734 0s4 in the sinking fund account
10 November /. 1891 leaving the net debt M
SjO.17l.992 The total debt AT maturity j.
So" 81 O. G93 Joss $40. 500 10 credit Of the
a
amount discounted at per cont compounded. is
$3.50 .9je the average date Of maturity Of debt
being July lOlso7. D,ducting S7.734.cs3 in the
sinking fund leaves the present value Of The d'ht
APPROX iNaiclv ar JO.75111S The requirement.
under ~ provisions Of tho mortgaCn proposed hv
the Conn i>Son = for tn first wears sl.529 u O.
reprcsontirg 5 per cert on so. 80. o0o and
s?537s1 as cnclalf Of per cent On outstanding
bonds fr tho sinking fund. Afr tho expiration
Of tn years the annual requirement would be
S2.O30.2SO
HOW 4 S~TrIrM-Vr Is rrOPOSrD.
Attached TO the majority report are bills for the
consideration OF COrgrcss. embodyng the recon-
mcndat ms of the Commissioners for eiectins
settlement between the Government and the sub
sidzed roads-thc Union Pacific. the Central
Pacific. the Central BTaLch Union lIciiic. and the
Sioux CIty and Pacific Railroad Com .ranics. They
are practically identical III PROV sions. The bill
affecting Union FAC Tic VII serve rs an eXam'e IF
the rest. J. proposes the issue Il genera NOR
gage oVtrng all tn prppert,. real ana personal.
OF The company, lands stock of bfahcr lines. C..
to he dated July |. lSS> ana 10 ure III hiiN
years. IN, t'ie method pro ldcd Tor a~c II am
ing the ai1onnt o. the new ~ gag: To the prIn-
cjpai OF the cXi> ing bonds Is added the IA cre-t
PAID and 70 be peId by The GpyDrume1t W 20 the
maturity Of the debt. and from hat IS taken The
interest which ha~ been pa d. ne NGr Ii or
of tbs III d. of July l. 1sNS, Is computed on he
bass Of pct cent Ter annuI a. re value "l
money. by cIscountIng the whole amount al that
time be Neen JAY /. 1885, and tue date OF the
average maturity of tla beds; Then The
amount, co ane SINKING i dranc,e dYI aG
the sun remaining stands az the amount due on
July !, 1855. il re roads were to 9ay oil TIE deb,
entirely. Ii IStlIS sum which IT Is recommended
he taken a the PRINCIPAL OF the new NOR grge.
TIE -ecurltes III he sinking fund are to be valued
a. tine market II ce a. the Secretary % tie iTe,s-
ury shall de terrnnr Three per cent annually. pay
able Ja1nary aud July % each wear, IS liked u
the rate o. interest. A default for SIX months III
The i'm mediate nat m Of the entire deDt. ! he
snking fund 70 be secured by pawn nj OF y OF
] per EN- each year FIR tn wears and pr cent
pr dnnum from then ~. The company l. a lowed
lie privlie - a. altclDating the dent or anv part
OF Il. Two trustees OF each mortgage a.e Ia be up
painted. one ~ me President Oh me tnl'ed SAFE
a,d ne o.h-r ~ he company. subject 20 the ap
proval of ne President OF he Cplted Staies The
Cove runent trI>. &c Is not 20 receive salary Of
over 81 10 900 wear. One of the safeguard, thrown
around The edcral IA erests l. the tDrbiddlng
OF The paNment of any DIV dad b. TIE iacIiir
rodcs not ac ua,ly earnrG III the year wnen II Is
dee Jared. And after per cent has been paid any
excess gong 10 stOekho 6ers must be accom- PANIED
hv al equal amount p9ld 10 the Govern 1eht sink
iuG u d IN aidli ION to the regular SINKING luna
requirements
Ii the settlement is accep ed bv the cOmpany.
the Office o. Government director u 10 be
abolished anl the road IS permitted 10
extend any existing bonds not Issued
bv tie Government at a rae OF interest not 10 cx-
ceei per cen; n wear IL j. also permitted 10 ~
lease TO the Government lands still unsettled AT a
yauato, of 81 % per acre 10 be used o cancel
the new bOlds lf t1> set cncnt II not accepted
tue percentage of pavmrnts from net earnings 10
the Cover meBt is raI-et iTOn % to 10 per cent
per annun aud the Treasury Department Is au-
thorlzed sell The sinkInr-i1.d ercufIties
The o7ier bills make substantially the same re-
Quire'neufs IN all IDnort mt particulars eZcept
that III case If n acceptance Of the pTc-crlned
terms I q CcriIa Pacific Company and he Sioux
City aud Pacific companies are required To pay to
the GoVeI men. all the ne earnings OF their ub
cid zel roads, and the Central irlnc'I Union
Tac ic 70 PER ceut. as against only 10 per cent for
the Union Pac nc
The maioritg r-port declares that the system re-
ouirir PAYMENTS of y percentag" of net earnings
f. undesirable as leading 10 endless d .pnle., III
y0ivIng incessart iilatIln 10 wh CD The spve gn
power of the United States should not be -ubjscted
CRITICISM OF PAST MANIAC MEMS
Tn, history of the Union Pacific Hallway de-